17 September 2006

Peter F Drucker - Collected Quotes

"What the worker needs is to see the plant as if he were a manager. Only thus can he see his part, from his part he can reach the whole. This ‘seeing’ is not a matter of information, training courses, conducted plant tours, or similar devices. What is needed is the actual experience of the whole in and through the individual's work." (Peter F Drucker, "The New Society", 1950)

"A manager sets objectives - A manager organizes - A manager motivates and communicates - A manager, by establishing yardsticks, measures." (Peter F Drucker, "The Practice of Management", 1954)

"Business is a process which converts a resource, distinct knowledge, into a contribution of economic value in the market place. The purpose of a business is to create a cust Au omer. The purpose is to provide something for which an independent outsider, who can choose not to buy, is willing to exchange his purchasing power. And knowledge alone (excepting only the case of the complete monopoly) gives the products of any business that leadership position on which success and survival ultimately depend." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"But waste is often hard to find. The costs of not-doing tend to be hidden in the figures. […] Waste runs high in any business. Man, after all, is not very efficient. Special efforts to find waste are therefore always necessary." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"Costs - their identification, measurement, and control - are the most thoroughly worked, if not overworked, business area. […] Altogether focusing resources on results is the best and most effective cost control. Cost, after all, does not exist by itself. It is always incurred - in intent at least - for the sake of a result. What matters therefore is not the absolute cost level but the ratio between efforts and their results." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"Results are obtained by exploiting opportunities, not by solving problems. [...] Resources, to produce results, must be allocated to opportunities rather than to problems." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"The best way to come to grips with one’s own business knowledge is to look at the things the business has done well, and the things it apparently does poorly. […] Knowledge is a perishable commodity. It has to be reaffirmed, relearned, repracticed all the time. One has to work constantly at regaining one’s specific excellence. […] The right knowledge is the knowledge needed to exploit the market opportunities." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"There are three different dimensions to the economic task: (1) The present business must be made effective; (2) its potential must be identified and realized; (3) it must be made into a different business for a different future. Each task requires a distinct approach. Each asks different questions. Each comes out with different conclusions. Yet they are inseparable. All three have to be done at the same time: today." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"To be able to control costs, a business therefore needs a cost analysis which: Identifies the cost centers - that is, the areas where the significant costs are, and where effective cost reduction can really produce results. Finds what the important cost points are in each major cost center. Looks at the entire business as one cost stream. Defines ‘cost’ as what the customer pays rather than as what the legal or tax unit of accounting incurs. Classifies costs according to their basic characteristics and thus produces a cost diagnosis." (Peter F Drucker, "Managing for Results: Economic Tasks and Risk-taking Decisions", 1964)

"Modern organization makes demands on the individual to learn something he has never been able to do before: to use organization intelligently, purposefully, deliberately, responsibly [...] to manage organization [...] to make [...] his job in it serve his ends, his values, his desire to achieve." (Peter F Drucker, The Age of Discontinuity, 1968)

"Effectiveness is the foundation of success - efficiency is a minimum condition for survival after success has been achieved. Efficiency is concerned with doing things right. Effectiveness is doing the right things." (Peter Drucker, "Management: Tasks, Responsibilities, Challenges", 1973)

"Leadership is lifting a person's vision to higher sights, the raising of a person's performance to a higher standard, the building of a personality beyond its normal limitations." (Peter Drucker, "Management: Tasks, Responsibilities, Challenges", 1973)

"[Management] has authority only as long as it performs." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"Managers, therefore, need to be skilled in making decisions with long futurity on a systematic basis. Management has no choice but to anticipate the future, to attempt to mold it, and to balance short-range and long-range goals.[…] 'Short range' and 'long range' are not determined by any given time span. A decision is not short range because it takes only a few months to carry it out. What matters is the time span over which it is effective. […] The skill we need is not long-range planning. It is strategic decision-making, or perhaps strategic planning." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"Organizationally what is required - and evolving - is systems management." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"[…] strategic planning […] is the continuous process of making present entrepreneurial (risk-taking) decisions systematically and with the greatest knowledge of their futurity; organizing systematically the efforts needed to carry out these decisions; and measuring the results of these decisions against the expectations through organized, systematic feedback." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"Strategic planning is not the 'application of scientific methods to business decision' […] . It is the application of thought, analysis, imagination, and judgment. It is responsibility, rather than technique. […] Strategy planning is not forecasting. […] Strategic planning is necessary precisely because we cannot forecast. […] Strategic planning does nor deal with future decisions. It deals with the futurity of present decisions. […] Strategic planning is not an attempt to eliminate risk. It is not even an attempt to minimize risk." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"'Structure follows strategy' is one of the fundamental insights we have acquired in the last twenty years. Without understanding the mission, the objectives, and the strategy of the enterprise, managers cannot be managed, organizations cannot be designed, managerial jobs cannot be made productive. [...] Strategy determines what the key activities are in a given business. And strategy requires knowing 'what our business is and what it should be'." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"There is a point of complexity beyond which a business is no longer manageable." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"The manager is a servant. His master is the institution he manages and his first responsibility must therefore be to it." (Peter F Drucker, "Management: Tasks, Responsibilities, Practices", 1973)

"The worker's effectiveness is determined largely by the way he is being managed. (Peter F Drucker, Management: Tasks, Responsibilities, Practices", 1973)

"Above all, innovation is not invention. It is a term of economics rather than of technology. [...] The measure of innovation is the impact on the environment. [...] To manage innovation, a manager has to be at least literate with respect to the dynamics of innovation." (Peter F Drucker, "People and Performance", 1977)

"'Management' means, in the last analysis, the substitution of thought for brawn and muscle, of knowledge for folkways and superstition, and of cooperation for force. It means the substitution of responsibility for obedience to rank, and of authority of performance for authority of rank. (Peter F Drucker, "People and Performance", 1977)

"Objectives are not fate; they are direction. They are not commands; they are commitments. They do not determine the future; they are means to mobilize the resources and energies of the business for the making of the future." (Peter F Drucker, "People and Performance", 1977)

"[...] the first criterion in identifying those people within an organization who have management responsibility is not command over people. It is responsibility for contribution. Function rather than power has to be the distinctive criterion and the organizing principle." (Peter F Drucker, "People and Performance", 1977)

"[...] when a variety of tasks have all to be performed in cooperation, syncronization, and communication, a business needs managers and a management. Otherwise, things go out of control; plans fail to turn into action; or, worse, different parts of the plans get going at different speeds, different times, and with different objectives and goals, and the favor of the "boss" becomes more important than performance." (Peter F Drucker, "People and Performance", 1977)

"Knowledge work, unlike manual work, cannot be replaced by capital investment. On the contrary, capital investment creates the need for more knowledge work." (Peter F Drucker, "Management in Turbulent Times", 1980)

"The productivity of work is not the responsibility of the worker but of the manager." (Peter F Drucker, "Management in Turbulent Times", 1980)

"Top management work is work for a team rather than one man." (Peter F Drucker, "Memos for Management: Leadership", 1983)

"No other area offers richer opportunities for successful innovation than the unexpected success." (Peter Drucker, "Innovation and Entrepreneurship", 1985)

"You cannot prevent a major catastrophe, but you can build an organization that is battle-ready, where people trust one another. In military training, the first rule is to instill soldiers with trust in their officers - because without trust, they won't fight." (Peter Drucker, "Managing the Non-Profit Organization", 1990)

"Knowledge has to be improved, challenged, and increased constantly, or it vanishes." (Peter F Drucker) 

"So much of what we call management consists in making it difficult for people to work." (Peter F Drucker)

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